Why is KYC mandatory in CEX? | Bitcointalksearch.org

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Quote from: coinerer on September 20, 2023, 11:09:36 AM

Quote from: Altcoiner007 on September 05, 2023, 05:51:54 AM

Privacy is important when it comes to Cryptocurrency, so why do exchanges like Bitget require KYC (Know Your Customer) for all users, even those who only want to get airdrops? I thought KYC should be for those transacting many Bitcoins, Is it really necessary for everyone?

The reason for making KYC mandatory is to prevent activities like money laundering. Because his kyc document will be given there. Whether or not to use a platform is entirely a personal matter for an individual. If you don't want to do kyc you can use DEX instead of CEX where no kyc is required. But if you are using CEX then you need to complete kyc as it falls within their terms & conditions. And to use their service must follow their terms & conditions

CEX needs to abide by government laws and regulations. Therefore they take proactive measures by enforcing KYC so that in future if they are questioned about the illegal use of money (Money laundering etc), they have the details of the person and they can give this data to the authorized agencies upon request. If the CEX won't implement the KYC, they can get into trouble themselves.

Also, I think people may report that a certain CEX is running without the KYC and it can lead to the closure of their business by the authorities. In simple words, it's hard to run an exchange business without implementing the KYC.

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Quote from: Kasabus on September 20, 2023, 03:50:34 PM

CEX are highly regulated by groups or entities, so it’s also expected that this exchange in return will also follow what the regulators have imposed to them. And this compulsory KYC is one factor that will make an exchange more centralized and monitored by the government or any other group or entity. That’s why if you are in a centralized exchange, consider KYC as compulsory.

When we utilized CEX, we had to go through a KYC process before we could withdraw, and if we didn't, we could only withdraw a small amount of money till we submitted. If the exchange do not have KYC, your payment options are limited to banks that agreed in your terms and conditions that you would not utilize KYC.

Because CEX users are transparent to them, it may put their identities at danger of being sold to criminals, particularly those with the most money in their wallet. Because they are worried of this, many crypto users choose to use DEX. Even if I only have a modest budget, I'm still afraid but it's preferable to utilize CEX because there's no hassle.

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Quote from: Altcoiner007 on September 05, 2023, 05:51:54 AM

Privacy is important when it comes to Cryptocurrency, so why do exchanges like Bitget require KYC (Know Your Customer) for all users, even those who only want to get airdrops? I thought KYC should be for those transacting many Bitcoins, Is it really necessary for everyone?

Good enough it’s what you think should be the case and that isn’t what is for some good reason. Maybe not to user’s advantage but, it sure do helps the exchange with regards to authorities which in turn, ensures there are these services for crypto investors to use.

KYC is simply a an avenue for these firms to have some idea on whom there customers are. That’s not so much but, where it becomes an issue is, what would these guys do with this data, who are those it’s exposed to, how could they be sure it doesn’t fall into the wrong hands and more of concerning questions as those. That’s where the issue always comes in. That’s why it’s cool to use that which makes you feel safe or you could trust.

Don’t forget, these are centralized exchanges and they’ve got to play in accordance with the laws of the jurisdiction in which they operate to avoid being short down.

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CEX are highly regulated by groups or entities, so it’s also expected that this exchange in return will also follow what the regulators have imposed to them. And this compulsory KYC is one factor that will make an exchange more centralized and monitored by the government or any other group or entity. That’s why if you are in a centralized exchange, consider KYC as compulsory.

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Quote from: coinerer on September 20, 2023, 11:09:36 AM

Quote from: Altcoiner007 on September 05, 2023, 05:51:54 AM

Privacy is important when it comes to Cryptocurrency, so why do exchanges like Bitget require KYC (Know Your Customer) for all users, even those who only want to get airdrops? I thought KYC should be for those transacting many Bitcoins, Is it really necessary for everyone?

The reason for making KYC mandatory is to prevent activities like money laundering. Because his kyc document will be given there. Whether or not to use a platform is entirely a personal matter for an individual. If you don't want to do kyc you can use DEX instead of CEX where no kyc is required. But if you are using CEX then you need to complete kyc as it falls within their terms & conditions. And to use their service must follow their terms & conditions

There are many reasons why KYC is mandatory on centralized exchanges and is mostly because of the government interest on certain matters. Apart from the government too, the exchange need to be prepared for the worse in case something happens that need to very the identities of users mostly when something like scam and hacks happen.

Know your customers help centralized exchange to check in on who there customers are and how they make transactions whether it involves money laundry or not. The centralized exchanges are mostly government influenced.

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Quote from: coinerer on September 20, 2023, 11:09:36 AM

Quote from: Altcoiner007 on September 05, 2023, 05:51:54 AM

Privacy is important when it comes to Cryptocurrency, so why do exchanges like Bitget require KYC (Know Your Customer) for all users, even those who only want to get airdrops? I thought KYC should be for those transacting many Bitcoins, Is it really necessary for everyone?

The reason for making KYC mandatory is to prevent activities like money laundering. Because his kyc document will be given there. Whether or not to use a platform is entirely a personal matter for an individual. If you don't want to do kyc you can use DEX instead of CEX where no kyc is required. But if you are using CEX then you need to complete kyc as it falls within their terms & conditions. And to use their service must follow their terms & conditions

And because of local regulations when they experience problems such as money laundering, the platform can find out by doing the documents provided, so the exchange will apply KYC to all users not just for large transactions.
With you already doing KYC, any activity will be known by the centralized platform, so inevitably KYC must be an obligation for us at CEX. If there are other options then use a less strict one because there are still some that enforce this if you want to be completely anonymous then indeed DEX is the solution, but I'm sure more use CEX than DEX.

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Quote from: Maslate on September 13, 2023, 08:59:03 AM

Quote from: Smack That Ace on September 13, 2023, 08:16:53 AM

I think KYC helps exchanges to control and track their users to avoid cases of scam or money laundering...The exchange collapse issue has nothing to do with KYC. The collapse of exchanges has legal implications and the government must be held responsible. But another thing is that we don't want to be controlled by the government, we want to be free, but when we are scammed, we ask the government to solve it. This is one of the loopholes in the crypot market and scammers are fully exploiting it.

The only way users can scam an exchange is if they can hack it, aside from that I don't see any possibility. KYC is just a simple verification process where an exchange would like to know their users and it's mandatory to all legal exchange as they are regulated by a certain agency of the government, so there's no need to question that because exchanges nowadays are like banks.

If we are expecting full anonymity, then there's always this decentralized exchange, but the problem is they don't have the volume like CEX, and that only tells us that more people trust centralized exchange over decentralized exchange which we can conclude that most of them do comply with the KYC.

You don't necessarily need to hack the whole exchange, you can just get access to a single profile and then steal whatever is in it. Unfortunately still nowadays many people don't use 2FA and their passwords are extremely easy to guess, that is the real problem. People should understand that they need to use all the security tools the exchanges provide, and especially avoid using the phone number to receive texts, etc.

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Quote from: Altcoiner007 on September 05, 2023, 05:51:54 AM

Privacy is important when it comes to Cryptocurrency, so why do exchanges like Bitget require KYC (Know Your Customer) for all users, even those who only want to get airdrops? I thought KYC should be for those transacting many Bitcoins, Is it really necessary for everyone?

The reason for making KYC mandatory is to prevent activities like money laundering. Because his kyc document will be given there. Whether or not to use a platform is entirely a personal matter for an individual. If you don't want to do kyc you can use DEX instead of CEX where no kyc is required. But if you are using CEX then you need to complete kyc as it falls within their terms & conditions. And to use their service must follow their terms & conditions

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Quote from: Altcoiner007 on September 05, 2023, 05:51:54 AM

Privacy is important when it comes to Cryptocurrency, so why do exchanges like Bitget require KYC (Know Your Customer) for all users, even those who only want to get airdrops? I thought KYC should be for those transacting many Bitcoins, Is it really necessary for everyone?

KYC is the main tool, which is used by crypto enterprises to avoid court issues. First group of court issues are problems of the enterprise itself: accusations of tax evasion, money laundering etc. Since all the cryptocurrencies are anonymous, it's really hard to prove innocent without bunches of KYC data. Second group of cases are person vs person cases, in which the enterprise is a platform for money exchange. In such cases if all the transactions are deanonymised and registered, it might make clear who tells the truth who lies and what really happened. If such transaction registries are not made, then the enterprise itself can easily become te next victim of this court case.

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Quote from: Blitzboy on September 13, 2023, 09:55:28 AM

Quote from: Maslate on September 13, 2023, 08:59:03 AM

Quote from: Smack That Ace on September 13, 2023, 08:16:53 AM

I think KYC helps exchanges to control and track their users to avoid cases of scam or money laundering...The exchange collapse issue has nothing to do with KYC. The collapse of exchanges has legal implications and the government must be held responsible. But another thing is that we don't want to be controlled by the government, we want to be free, but when we are scammed, we ask the government to solve it. This is one of the loopholes in the crypot market and scammers are fully exploiting it.

The only way users can scam an exchange is if they can hack it, aside from that I don't see any possibility. KYC is just a simple verification process where an exchange would like to know their users and it's mandatory to all legal exchange as they are regulated by a certain agency of the government, so there's no need to question that because exchanges nowadays are like banks.

If we are expecting full anonymity, then there's always this decentralized exchange, but the problem is they don't have the volume like CEX, and that only tells us that more people trust centralized exchange over decentralized exchange which we can conclude that most of them do comply with the KYC.

KYC is essential to this progress. It reassures markets and regulators that fraud will decrease. KYC may deter bad behaviour, but no system is immune to hacking.

DEX may not have as much traffic as centralised exchanges, but they offer something special. You can encounter people who prioritise independence and decentralisation over speed and money there. CEX have the most users, however DEXs are gaining popularity. As more individuals learn about blockchain technologies, DEXs may gain users.

If evaluated fairly, DEX is not a new technology on the market, it has appeared and existed for quite a long time but because of some limitations, it still cannot compete with CEX. CEX really brings more utilities and services that we need and almost people cannot give up CEX even though they know that there are many risks when using it.

DEX has its advantages and especially emphasizes privacy, but it cannot be denied that the liquidity of DEX is really too small compared to CEX. Frankly, I also do not believe that the game will become fairer, CEX will still prevail whether we believe it or not.

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Quote from: Maslate on September 13, 2023, 08:59:03 AM

Quote from: Smack That Ace on September 13, 2023, 08:16:53 AM

I think KYC helps exchanges to control and track their users to avoid cases of scam or money laundering...The exchange collapse issue has nothing to do with KYC. The collapse of exchanges has legal implications and the government must be held responsible. But another thing is that we don't want to be controlled by the government, we want to be free, but when we are scammed, we ask the government to solve it. This is one of the loopholes in the crypot market and scammers are fully exploiting it.

The only way users can scam an exchange is if they can hack it, aside from that I don't see any possibility. KYC is just a simple verification process where an exchange would like to know their users and it's mandatory to all legal exchange as they are regulated by a certain agency of the government, so there's no need to question that because exchanges nowadays are like banks.

If we are expecting full anonymity, then there's always this decentralized exchange, but the problem is they don't have the volume like CEX, and that only tells us that more people trust centralized exchange over decentralized exchange which we can conclude that most of them do comply with the KYC.

You don't need to avoid Know Your Customer (KYCs). It is intended to protect you and the gambling company. Unless you are going to do something illegal well of course you have to fear it. But these procedures are a standard requirement for most legitimate cryptocurrency exchanges. These procedures are mandated by regulatory agencies to ensure that exchanges can verify the identities of their users. By doing so, exchanges can comply with legal frameworks aimed at preventing illegal activities like money laundering and fraud.

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Quote from: Maslate on September 13, 2023, 08:59:03 AM

Quote from: Smack That Ace on September 13, 2023, 08:16:53 AM

I think KYC helps exchanges to control and track their users to avoid cases of scam or money laundering...The exchange collapse issue has nothing to do with KYC. The collapse of exchanges has legal implications and the government must be held responsible. But another thing is that we don't want to be controlled by the government, we want to be free, but when we are scammed, we ask the government to solve it. This is one of the loopholes in the crypot market and scammers are fully exploiting it.

The only way users can scam an exchange is if they can hack it, aside from that I don't see any possibility. KYC is just a simple verification process where an exchange would like to know their users and it's mandatory to all legal exchange as they are regulated by a certain agency of the government, so there's no need to question that because exchanges nowadays are like banks.

If we are expecting full anonymity, then there's always this decentralized exchange, but the problem is they don't have the volume like CEX, and that only tells us that more people trust centralized exchange over decentralized exchange which we can conclude that most of them do comply with the KYC.

KYC is essential to this progress. It reassures markets and regulators that fraud will decrease. KYC may deter bad behaviour, but no system is immune to hacking.

DEX may not have as much traffic as centralised exchanges, but they offer something special. You can encounter people who prioritise independence and decentralisation over speed and money there. CEX have the most users, however DEXs are gaining popularity. As more individuals learn about blockchain technologies, DEXs may gain users.

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Quote from: Smack That Ace on September 13, 2023, 08:16:53 AM

I think KYC helps exchanges to control and track their users to avoid cases of scam or money laundering...The exchange collapse issue has nothing to do with KYC. The collapse of exchanges has legal implications and the government must be held responsible. But another thing is that we don't want to be controlled by the government, we want to be free, but when we are scammed, we ask the government to solve it. This is one of the loopholes in the crypot market and scammers are fully exploiting it.

The only way users can scam an exchange is if they can hack it, aside from that I don't see any possibility. KYC is just a simple verification process where an exchange would like to know their users and it's mandatory to all legal exchange as they are regulated by a certain agency of the government, so there's no need to question that because exchanges nowadays are like banks.

If we are expecting full anonymity, then there's always this decentralized exchange, but the problem is they don't have the volume like CEX, and that only tells us that more people trust centralized exchange over decentralized exchange which we can conclude that most of them do comply with the KYC.

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Quote from: Cookdata on September 13, 2023, 07:45:38 AM

Quote from: Hanadawa on September 13, 2023, 05:09:07 AM

Quote from: Altcoiner007 on September 05, 2023, 05:51:54 AM

Privacy is important when it comes to Cryptocurrency, so why do exchanges like Bitget require KYC (Know Your Customer) for all users, even those who only want to get airdrops? I thought KYC should be for those transacting many Bitcoins, Is it really necessary for everyone?

I think KYC is an important thing. Cryptocurrencies have many challenges related to government regulation. Therefore, having KYC will make it easier for the CEX exchange to carry out transactions and trades. Your idea that KYC is only for those who make a lot of transactions is a good idea.

However, it will be quite difficult to implement this because there could be loopholes that will be exploited by those who don't want KYC. Or it can also be used to create scam because without KYC, people can create whatever accounts they want. And this could be a problem for CEX in the future.

Can you name one thing KYC has done for crypto since the government started the implementation? How many times has cex defaulted and announced being bankrupt due to hacks and stolen funds, even yesterday there was hacked that took place in one of the crypto exchanges called cryptoEX and it was reported that about $27M worth of ETH was stolen, who is the government supposed to KYC? The exchanges that are losing custody of user's funds to hack or the users that are just there to exchange? HUH!

KYC has been useful for the exchange to identify user's identity but I don't think it has been really useful the way it was intended, the centralized exchanges are the ones the government should be wary of, they have done more damage in crypto than even the said individuals. Look at how messy FTX has become till today, they are fighting each other within the teams, the sponsors, the politicians that accepted free donations, the lawyers and the venture capitalist and you think KYC is the problem, common bro.

I guess that centralized exchanges are just not as good as banks are at disguising the activities that are going on behind the scenes. FTX is a great example for that. Financing political campaigns on that level is insane. The dude with his curly hair and the jogging pants makes contributions in excess of $100 million to politicians. Then it turns out he ran some of the accounting for a multi-billion dollars company with spreadsheets and I think it was a free accounting software or something. Cheesy

Banks are running their own scams, but I think they know better how to do it then a young dude like SBF.

KYC at most exchanges is definitely a scam. I think when you take a publicly listed company like Coinbase, there is at least some oversight from regulatory bodies to make sure that they have a certain level of data security in place. But I have been asked by exchanges for my data that couldn't even spell the KYC shortage right. Cheesy

One time a customer support agent wrote it as words to me like "K Why see" or something like that. It was absurd. Cheesy

It's a few years ago and I wanted to trade one specific coin that at the time was only listed there. Better not trade the coin in the first place I guess. At some point they closed my account and I lost a few hundred dollars.

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Quote from: Cookdata on September 13, 2023, 07:45:38 AM

Quote from: Hanadawa on September 13, 2023, 05:09:07 AM

Quote from: Altcoiner007 on September 05, 2023, 05:51:54 AM

Privacy is important when it comes to Cryptocurrency, so why do exchanges like Bitget require KYC (Know Your Customer) for all users, even those who only want to get airdrops? I thought KYC should be for those transacting many Bitcoins, Is it really necessary for everyone?

I think KYC is an important thing. Cryptocurrencies have many challenges related to government regulation. Therefore, having KYC will make it easier for the CEX exchange to carry out transactions and trades. Your idea that KYC is only for those who make a lot of transactions is a good idea.

However, it will be quite difficult to implement this because there could be loopholes that will be exploited by those who don't want KYC. Or it can also be used to create scam because without KYC, people can create whatever accounts they want. And this could be a problem for CEX in the future.

Can you name one thing KYC has done for crypto since the government started the implementation? How many times has cex defaulted and announced being bankrupt due to hacks and stolen funds, even yesterday there was hacked that took place in one of the crypto exchanges called cryptoEX and it was reported that about $27M worth of ETH was stolen, who is the government supposed to KYC? The exchanges that are losing custody of user's funds to hack or the users that are just there to exchange? HUH!

KYC has been useful for the exchange to identify user's identity but I don't think it has been really useful the way it was intended, the centralized exchanges are the ones the government should be wary of, they have done more damage in crypto than even the said individuals. Look at how messy FTX has become till today, they are fighting each other within the teams, the sponsors, the politicians that accepted free donations, the lawyers and the venture capitalist and you think KYC is the problem, common bro.

I think KYC helps exchanges to control and track their users to avoid cases of scam or money laundering...The exchange collapse issue has nothing to do with KYC. The collapse of exchanges has legal implications and the government must be held responsible. But another thing is that we don't want to be controlled by the government, we want to be free, but when we are scammed, we ask the government to solve it. This is one of the loopholes in the crypot market and scammers are fully exploiting it.

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Quote from: Hanadawa on September 13, 2023, 05:09:07 AM

Quote from: Altcoiner007 on September 05, 2023, 05:51:54 AM

Privacy is important when it comes to Cryptocurrency, so why do exchanges like Bitget require KYC (Know Your Customer) for all users, even those who only want to get airdrops? I thought KYC should be for those transacting many Bitcoins, Is it really necessary for everyone?

I think KYC is an important thing. Cryptocurrencies have many challenges related to government regulation. Therefore, having KYC will make it easier for the CEX exchange to carry out transactions and trades. Your idea that KYC is only for those who make a lot of transactions is a good idea.

However, it will be quite difficult to implement this because there could be loopholes that will be exploited by those who don't want KYC. Or it can also be used to create scam because without KYC, people can create whatever accounts they want. And this could be a problem for CEX in the future.

Can you name one thing KYC has done for crypto since the government started the implementation? How many times has cex defaulted and announced being bankrupt due to hacks and stolen funds, even yesterday there was hacked that took place in one of the crypto exchanges called cryptoEX and it was reported that about $27M worth of ETH was stolen, who is the government supposed to KYC? The exchanges that are losing custody of user's funds to hack or the users that are just there to exchange? HUH!

KYC has been useful for the exchange to identify user's identity but I don't think it has been really useful the way it was intended, the centralized exchanges are the ones the government should be wary of, they have done more damage in crypto than even the said individuals. Look at how messy FTX has become till today, they are fighting each other within the teams, the sponsors, the politicians that accepted free donations, the lawyers and the venture capitalist and you think KYC is the problem, common bro.

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Quote from: GiftedMAN on September 12, 2023, 03:35:13 PM

Quote from: Synchronice on September 12, 2023, 09:52:04 AM

Quote from: Altcoiner007 on September 05, 2023, 05:51:54 AM

Privacy is important when it comes to Cryptocurrency, so why do exchanges like Bitget require KYC (Know Your Customer) for all users, even those who only want to get airdrops? I thought KYC should be for those transacting many Bitcoins, Is it really necessary for everyone?

If business didn't have regulations, they would definitely not ask you for KYC documents, wouldn't really care about the source of your money or probably would seize your account anytime. You use cryptocurrency for your privacy but once you make yourself in touch with centralized system, you are vanishing that privacy. Centralized systems 99% times don't care about your privacy because that's your problem, not theirs and to be honest, majority of people don't care about privacy too much if the service they get fulfills their needs.

Not all cex exchanges that do ask for KYC and these is mostly need to regulated exchanges to help curb money laundry and other illegal practice by scammers and hackers. The KYC helps to know who is who and reduce the art of scam attempt by individual customers. Many people that have been in the market for long now don't like a cex exchange that ask for KYC because they know what it means and the effect of giving there credentials to exchange and the data is misused or get to the hands of hackers. People still prefer to use p2p to sell there tokens that going to give there information to illegal exchanges.

Both CEX and DEX have pros and cons. While KYC helps CEX control and manage illegal activities, but KYC will also reveal user information and many people do not like this. Meanwhile, DEX does not require KYC and that is also a loophole that criminals will take advantage of to commit illegal acts. So it is difficult to say whether CEX is better or DEX is better. DEX users will criticize CEX and vice versa, just like cryptocurrency investors always criticize other investments like real estate or stocks. In my opinion, depending on each person's taste, there is a suitable choice, I will not say which one is better than the other.

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Quote from: Altcoiner007 on September 05, 2023, 05:51:54 AM

Privacy is important when it comes to Cryptocurrency, so why do exchanges like Bitget require KYC (Know Your Customer) for all users, even those who only want to get airdrops? I thought KYC should be for those transacting many Bitcoins, Is it really necessary for everyone?

I think KYC is an important thing. Cryptocurrencies have many challenges related to government regulation. Therefore, having KYC will make it easier for the CEX exchange to carry out transactions and trades. Your idea that KYC is only for those who make a lot of transactions is a good idea.

However, it will be quite difficult to implement this because there could be loopholes that will be exploited by those who don't want KYC. Or it can also be used to create scam because without KYC, people can create whatever accounts they want. And this could be a problem for CEX in the future.

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Quote from: Z-tight on September 12, 2023, 10:54:11 AM

Quote from: Blitzboy on September 10, 2023, 10:39:52 AM

It's interesting that we disclose our information to banks, companies, and social networking sites but not CEXs.

I hear a lot of people say this, but it is because centralized exchanges are provably very bad at storing their customers' information safely, they are regularly victims of hacks and data breaches, so the chances are high that the information you give to a centralized exchange could be sold in the black market someday.

Another reason i consider important is that i use a bank and i know they are centralized and must request for my personal information, but my reason of using BTC is because i want to hide some of my financial activities and use a currency that is censorship resistant, if i use centralized exchanges it defeats what i want to achieve and it is the same as me using my centralized bank for 100% of my financial activities.

If it comes to disclosing or selling customer information, you should think about social networks and credit lending institutions. They not only fully exploit your personal information, but also sell your information to partners and third parties for profit. Do you think they create a social network and provide it so you can use it for free without any requirements? If it were you, you would be kind enough to spend billions of dollars to create a social network for everyone to use for free?

Yes, if you use bitcoin to hide your assets from everyone, I completely agree and like I said, exchanges are not the place for us to store bitcoin. It's just a place to exchange, buy and sell...No one said we should use exchanges to store our bitcoins.

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Quote from: NotATether on September 05, 2023, 06:05:24 AM

Exchanges require KYC in order to stop fraud like stealing other people's bitcoins and cashing them out, money laundering, scams, hacks, and so on. Most countries require an exchange to have specific KYC measures because they are legally allowed to operate there.

Although I will say that requiring KYC for very small transactions is a bit of a stretch, as it's not really possible to do much with it in the first place.

Alot of people use CEX . Without KYC Cryptocurrencies particularly Bitcoin would be labeled a scam, a dubious scheme because the morally bankrupt people in the society who find the easiest avenue to rip people out of their hard earned money would have scammed alot of people through one fraudulent scheme or another using the CEX platform and there would be no means to identify or catch them. KYC discourages this

Topic: Why is KYC mandatory in CEX? (Read 891 times)